Title insurers paid $661.7 million in claims last year

Title insurers paid approximately $661.7 million in claims in 2003, up from $582.7 million the previous year, according an industry study released by the American Land Title Association. The payments were made to insured homeowners for losses they experienced under policies issued to them or their lender, or to defend those titles from the claims of others. "The public misperception that title insurers do not pay substantial claims results from a lack of understanding of what title insurance is and how it protects homeowners," said James Maher, EVP of ALTA. Maher added that the title industry spends more than 10 times the amount it pays in claims to perform title searches and cure title problems in order to avoid claims. Unlike other forms of insurance, title insurance is based on actions that have already occurred, not on what may occur in the future. An ALTA survey of 420 abstracters and agent operations showed that title problems arise in one out of every four real estate tra...